- Bitcoin forms bearish divergence after impressive rally that pushed above $100,000.
- Assessing whether BTC sell pressure could be building-up, potentially signaling profit-taking.
It is an interesting day for the Bitcoin [BTC] community as the cryptocurrency achieves one of its most noteworthy milestones. Price soared above $100,000 for the first time in history. But what’s next for the king of the cryptocurrencies?
Bullish December is unfolding well for Bitcoin as its price action pushed as high as $103,620 in the last 24 hours. But what next for BTC after this impressive milestone? Well, its price action may offer insights into the next possible move.
Source: TradingView
While Bitcoin has been hitting higher highs, its RSI has been forming lower highs. As a result, the cryptocurrency is forming a bearish divergence. This suggests that a wave of sell pressure could commence soon.
No signs of Bitcoin bears yet
There is a significant chance that Bitcoin could stay above the $100,000 price level and possibly extend its upside in the coming days.
However, a pullback is inevitable, especially as sell pressure starts building up. That may already be happening as evident by BTC exchange flows.
CryptoQuant revealed that exchange flows dipped significantly in the last 24 hours, indicating a momentum slowdown. More notably, exchange inflows peaked at 28,466 BTC on 5th December, compared to 27,945 BTC in exchange outflows.
Source: CryptoQuant
Higher exchange inflows than outflows could signal a build-up in sell pressure. However, Bitcoin continued extending its upside and this could also be explained by on-chain data.
Demand from the derivatives segment remained strong as evident by the surge in open interest. The latter clocked a new ATH at $65.23 billion at the time of writing.
Source: Coinglass
Bitcoin funding rates remained positive, surging to a new 2-week high as a reflection of the strong bullish demand. This confirmed that derivatives demand contributed significantly to BTC’s push above $100,000.
The open interest and positive funding rates also confirmed that there was no noteworthy uptick in sell pressure. Perhaps an indication that the market remains bullish, with expectations of more upside.
While BTCs latest historic rally is an exciting development, it is worth keeping in mind that it is forming a bearish divergence.
Read Bitcoin’s [BTC] Price Prediction 2024-25
Consumer behavior during the holidays may also influence many holders to take some profits off the table.
Quite a large number of Bitcoin holders, especially those that bought at significantly lower prices might be incentivized to take profits. An outcome that could possibly trigger a sizable retracement from BTC’s current price level.
